BUILDING SUBSIDY.

Auckland Star, Volume LXIV, Issue 211, 7 September 1933, Page 8

BUILDING SUBSIDY.

"ON AND OFF , POLICY. SURPRISE AT CESSATION. UNION SECRETARY'S VIEWS. "The policy of 'on and off' pursued 'by the Government in respect to the building subsidy scheme is as difficult to understand as a jig-saw ruzzle," said Mr. T. Bloodworth, secretary of the Amalgamated Society of Carpenters and Joiners, this morning. "When the iirwt subsidy scheme was introduced" it induced firms to carry out certain jobs that would otherwise not have been undertaken. On the other hand, large concerns, which could well afford to build without assistance from public funds, took advantage of the scheme. "The subsidy wa* then withdrawn—it had lasted about six months—and later reintroduced. In the interim practically no new work was put in hand, because there was a fixed idea in the minds of people that the Government would again provide a building bonus. In this they were right, but it was not contemplated that the scheme would last such a short' time. I know of several building projects that will not he definitely dropped because of this latest Government decision. "People Will Mark Time." "We will go through the same experience as before, and building operations will cease, as those thinking of putting up a house or carrying out. repairs will naturally mark time on the assumption that the scheme will be ou again at a later date." Mr. Bloodworth explained that under the original scheme the men engaged had to be selected from the ranks of the unemployed. Under the present, scheme the subsidy was paid whether the men employed were out of • work or not. The present scheme in reality made provision I for subsidising the -wages of small cm- • ployers who, being skilled tradesmen, had secured .jobs and were doing the. work themselves. If they were employing outsido workers the proposition was very small. This had a tendency to lower the prices for work, and cut-throat competition had been introduced because many of these- tradesmen were prepared to base tho wages value of a job on little more than the subsidy offered by the Unemployment Board. The board in effect had admitted into the benefits of its scheme a'large number of men, who were not previously a charge on the Unemployment Fund. At the same, time the hoard had given those men the opportunity to cut the prices of work offering.

Sales Tax and Exchange. With the exception of one or two tig eaid- Mr. ; Bloodwprth, the scheme - had not-provided work to any extent for members' of his union. The value of tho subsidy taken over the whole of a building job was about 12* per cent: The cost- to the building industry of the extra 15 per cent exchange an<l the' sales tax was approximately 10 per cent: If the Government abolished the ealee tax' on building supplies and exchange rate back to par, the industry would be benefited' to a, greater extent, than by the Unemployment. Board's subsidy scheme.

Applications for the subsidy w.ill be received by the Labour Department until Tuesday next. The official announcement of the cessation of the subsidy appears on page 10.